Jeffrey Gunchick v. Federal Insurance Company et al

Filing 117

ORDER Re: DEFENDANT FIC'S MOTION FOR SUMMARY JUDGMENT OR, IN THE ALTERNATIVE, PARTIAL SUMMARY JUDGMENT 22 by Judge Ronald S.W. Lew. The Court DENIESDefendants Motion for Summary Judgment or, in theAlternative, Partial Summary Judgment. SEE ORDER FOR FURTHER AND COMPLETE DETAILS. (jre)

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UNITED STATES DISTRICT COURT

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CENTRAL DISTRICT OF CALIFORNIA

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12 JEFFREY GUNCHICK,
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Plaintiff,
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v.

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FEDERAL INSURANCE COMPANY;
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inclusive,
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Defendants.

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I.

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CV 14-1162 RSWL (PJWx)
ORDER Re: DEFENDANT
FIC’S MOTION FOR
SUMMARY JUDGMENT OR, IN
THE ALTERNATIVE, PARTIAL
SUMMARY JUDGMENT [22]

INTRODUCTION

Currently before the Court is Defendant Federal

25 Insurance Company’s (“FIC” or “Defendant”) Motion for
26 Summary Judgment or, in the Alternative, Partial
27 Summary Judgment [22].

The Court, having reviewed all

28 papers and arguments submitted pertaining to this
1

1 Motion, NOW FINDS AND RULES AS FOLLOWS: The Court
2 DENIES Defendant’s Motion for Summary Judgment.
3

II. DISCUSSION

4 A.

Legal Standard

5

Motion for Summary Judgment

6

Summary judgment is appropriate when there is no

7 genuine issue of material fact and the moving party is
8 entitled to judgment as a matter of law.
9 P. 56(a).

Fed. R. Civ.

A genuine issue is one in which the evidence

10 is such that a reasonable fact-finder could return a
11 verdict for the non-moving party.
12 Lobby, 477 U.S. 242, 248 (1986).

Anderson v. Liberty
The evidence, and any

13 inferences based on underlying facts, must be viewed in
14 a light most favorable to the opposing party.

Diaz v.

15 American Tel. & Tel., 752 F.2d 1356, 1358 n.1 (9th Cir.
16 1985).
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Where the moving party does not have the burden of

18 proof at trial on a dispositive issue, the moving party
19 may meet its burden for summary judgment by showing an
20 "absence of evidence" to support the non-moving party's
21 case.
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Celotex v. Catrett, 477 U.S. 317, 325 (1986).

The non-moving party, on the other hand, is

23 required by Federal Rule of Civil Procedure 56(e) to go
24 beyond the pleadings and designate specific facts
25 showing that there is a genuine issue for trial.
26 at 324.

Id.

Conclusory allegations unsupported by factual

27 allegations, however, are insufficient to create a
28 triable issue of fact so as to preclude summary
2

1 judgment.

Hansen v. United States, 7 F.3d 137, 138

2 (9th Cir. 1993) (citing Marks v. Dep’t of Justice, 578
3 F.2d 261, 263 (9th Cir. 1978)).

A non-moving party who

4 has the burden of proof at trial must present enough
5 evidence that a "fair-minded jury could return a
6 verdict for the [opposing party] on the evidence
7 presented."

Anderson, 477 U.S. at 255.

In ruling on a

8 motion for summary judgment, the Court's function is
9 not to weigh the evidence, but only to determine if a
10 genuine issue of material fact exists. Id.
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12 B.

Analysis

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a.

Summary Judgment on the Wrongful Termination

14 Claim
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At the summary judgment stage of a claim for

16 wrongful termination in violation of public policy,
17 courts follow a three part burden-shifting framework
18 established in McDonnell Douglas Corp. v. Green, 411
19 U.S. 792 (1973):
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In the first stage, the plaintiff must

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show (1) he or she engaged in a

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protected activity, (2) the employer

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subjected the employee to an adverse

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employment action, and (3) a causal

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link existed between the protected

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activity and the employer's action.

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If the employee successfully

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establishes these elements and thereby
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shows a prima facie case exists, the

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burden shifts to the employer to

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provide evidence that there was a

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legitimate, nonretaliatory reason for

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the adverse employment action.

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employer produces evidence showing a

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legitimate reason for the adverse

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employment action, the presumption of

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retaliation drops out of the picture,

If the

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and the burden shifts back to the

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employee to provide substantial

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responsive evidence that the

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employer's proffered reasons were

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untrue or pretextual.

15 Loggins v. Kaiser Permanente Int'l, 151 Cal. App. 4th
16 1102, 1109 (2007)(internal citations and punctuation
17 omitted).

Each of the parts is discussed below.

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i.

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on each element of the prima facie

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showing?

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Has Plaintiff created a triable issue

Defendant argues that Plaintiff has failed to state

22 a prima facie case for wrongful termination in
23 violation of public policy. More specifically,
24 Defendant argues that Plaintiff “was not performing
25 satisfactorily as he was found to have engaged in work
26 misconduct,” and as a result, he cannot show the
27 requisite elements of the claim. Mot. 6:24-26.
28 Defendant suggests that to meet his burden, Plaintiff
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1 must show that (1) he was disabled; (2) he was
2 performing satisfactorily; (3) he was subjected to an
3 adverse employment action; and (4) circumstances
4 suggest a discriminatory motive. Mot. 6:19-23.
5 Defendant’s authority for this proposition is unclear
6 in Defendant’s Motion, as it is cited as “Id.” but the
7 previous citation is to Plaintiff’s complaint and the
8 citations previous to that citation are string
9 citations. Mot. 6:23. The California Supreme Court in
10 the age discrimination case Guz v. Bechtel Nat. Inc.,
11 24 Cal.4th 317, 354 (2000), noted that for
12 discrimination claims, “the specific elements of a
13 prima facie case may vary depending on the particular
14 facts” but that “generally, a plaintiff must provide
15 evidence” of the four elements articulated above. The
16 California Civil Jury Instructions, however, identify
17 the following four elements as comprising a claim for
18 Wrongful Termination in Violation of California Public
19 Policy: (1) Plaintiff was employed by Defendant; (2)
20 Defendant discharged Plaintiff; (3) Plaintiff’s
21 disability was a substantial motivating reason for
22 Plaintiff’s discharge; and (4) the discharge caused
23 Plaintiff harm.
Thus, it is not clear that Plaintiff, to state a
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25 prima face case, needs to set forth facts that he was
26 performing satisfactorily. Even if this is a required
27 element, however, Plaintiff has met his summary
28 judgment burden in this regard. Defendant argues that
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1 “at the time of Plaintiff’s termination, Plaintiff was
2 not performing satisfactorily as he was found to have
3 engaged in work misconduct . . . . Consequently,
4 Plaintiff cannot show that he was satisfactorily
5 performing his job.” Mot. 6:24-28. Plaintiff, for his
6 part, contends that to the contrary, evidence indicates
7 “he was an excellent, good, hard working, conscientious
8 loyal performer who always went out of his way to
9 volunteer to assist the team and cared about his job
10 and the cases he worked on.” Opp’n 5:8-18; Pl.’s
11 Statement of Genuine Issues ¶ 3 (citing Axel Depo.
12 92:15-21, 95:18-96:1; Fisher Depo. 7:5-8, 85:7-6; Lalor
13 Depo. 89:15-23; Zegel Depo. 10:11-23). The mere fact
14 that Defendant has produced evidence it says indicates
15 Plaintiff’s misconduct is insufficient to show, as a
16 matter of law, that Plaintiff has not met his prima
17 facie burden.
Neither Plaintiff nor Defendant dispute that
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19 Plaintiff was employed by Defendant, nor that Defendant
20 discharged Plaintiff; they each dispute the other’s
21 professed motivating reasons for the discharge with
22 admissible evidence; and they each dispute the nature
23 of Plaintiff’s injury. Accordingly, Plaintiff has met
24 his burden of a prima facie showing sufficient to
25 survive the first step of the summary judgment test.
ii. Has defendant met its burden of
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showing its actions were based on

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legitimate reasons?
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Defendant has presented sufficient evidence to

2 support its claims that Plaintiff’s termination was a
3 result of his failure to abide by company policy. See
4 Def.’s Proposed Separate Statement of Uncontroverted
5 Facts and Conclusions of Law ¶¶ 3-16. These proffered
6 reasons, because they are “nondiscriminatory on their
7 face,” suffice to shift the burden back to Plaintiff.
8 See Kariotis v. Navistar Intern. Transp. Corp., 131
9 F.3d 672, 676 (7th Cir. 1997).
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iii.

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of fact over it being pretextual?

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Has plaintiff raised a triable issue

“To avoid summary judgment, an employee claiming

13 discrimination must offer substantial evidence that the
14 employer's stated nondiscriminatory reason for the
15 adverse action was untrue or pretextual, or evidence
16 the employer acted with a discriminatory animus, or a
17 combination of the two, such that a reasonable trier of
18 fact could conclude the employer engaged in intentional
19 discrimination.” Hersant v. Dep't of Soc. Servs., 57
20 Cal. App. 4th 997, 1004-05 (1997). Plaintiff has
21 offered a litany of statements and other indicators
22 allegedly made by his superiors that, if taken to be
23 true, could lead to the determination that Defendant’s
24 proffered reason for terminating Plaintiff was
25 pretextual and that Defendant actually terminated
26 Plaintiff because of his disability. See, e.g.,
27 Gunchick Decl. ¶¶ 9-13, 15-19. Defendant, for its
28 part, disputes that its agents ever made the alleged
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1 statements. While Defendant spends a substantial
2 portion of the Motion emphasizing that Plaintiff’s
3 subjective belief in the reasons for his termination
4 are irrelevant, Mot. 11:12-10, in fact, Defendant’s
5 emphasis on this point is misplaced. The Court finds
6 that Plaintiff’s allegations of discriminatory
7 statements and behaviors suffice to overcome the
8 summary judgment motion, because while Plaintiff’s
9 credibility may be suspect, if he is believed, then a
10 reasonable trier of fact could conclude that Defendant
11 engaged in intentional discrimination.
b. Partial Summary Judgment on Punitive
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Damages
Cal. Civ. Code §3294 governs the availability of

15 punitive damages in this action.
16 relevant part:
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It states, in

(a) In an action for the breach of

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an obligation not arising from

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contract, where it is proven by clear

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and convincing evidence that the

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defendant has been guilty of

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oppression, fraud, or malice, the

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plaintiff, in addition to the actual

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damages, may recover damages for the

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sake of example and by way of

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punishing the defendant.

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(b) An employer shall not be liable
for damages pursuant to subdivision
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(a), based upon acts of an employee of

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the employer, unless the employer had

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advance knowledge of the unfitness of

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the employee and employed him or her

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with a conscious disregard of the

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rights or safety of others or

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authorized or ratified the wrongful

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conduct for which the damages are

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awarded or was personally guilty of

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oppression, fraud, or malice. With

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respect to a corporate employer,

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the advance knowledge and conscious

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disregard, authorization,

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ratification or act of oppression,

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fraud, or malice must be on the

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part of an officer, director, or

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managing agent of the corporation.

18 Cal. Civ. Code §3294 . Thus, Defendant can only be
19 liable for punitive damages if it had advance knowledge
20 of and conscious disregard for, or authorised or
21 ratified, an act of oppression, fraud, or malice by one
22 or more of its officers, directors or managing agents.
23 Id. Under California law, managing agents are
24 “corporate employees who exercise substantial
25 independent authority and judgment in their corporate
26 decisionmaking so that their decisions ultimately
27 determine corporate policy.” White v. Ultramar, Inc.,
28 21 Cal.4th 563, 566–67 (1999).
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Corporate policies are

1 those that “affect a substantial portion of the company
2 and that are the type likely to come to the attention
3 of corporate leadership.” Roby v. McKesson Corp., 47
4 Cal.4th 686, 715 (2009). This level of misdeed must be
5 more than mere “managerial malfeasance”–it must be
6 indicative of a “corporate purpose to cause injury.”
7 Id. at 797-98.
If a jury can reasonably infer that one of the
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9 agents named by Plaintiff is a managing agent of
10 Defendant, a corporation, then the Court cannot find as
11 a matter of law that punitive damages are unavailable.
12 See Mitri v. Walgreen Co., 566 F. App'x 606, 607 (9th
13 Cir. 2014). Defendant argues that “[a]t best,
14 Plaintiff has only alleged conduct by supervisors” and
15 that these “supervisors” cannot be deemed to be
16 managing agents. Mot. 12:3-12. The “supervisors” in
17 question include Ms. Axel, Mr. Fisher, and, and Mr.
18 Lalor. Ms. Axel, for example, is a Vice President by
19 title who acts as a Human Resources Manager; she is the
20 highest ranking human resources official for the 400
21 employees in her region. Axel Depo. 114:7-20.
22 California courts have held that regional managers of
23 substantially fewer people can be managing agents for
24 the purposes of § 3294 liability. See id. (an employee
25 occupying a position four levels before the president
26 of a multinational corporation who had responsibility
27 for a market including four states and made personnel
28 decisions with apparent authority “that might implicate
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1 company-wide policies” could have been found to have
2 been a managing agent); White v. Ultramar, Inc., 21
3 Cal.4th at 577 (1999)(a “zone manager” responsible for
4 managing eight stores and sixty-five employees was a
5 managing agent); Major v. Western Home Ins. Co., 169
6 Cal.App.4th 1197, 1220 (2009) (a claims adjustor with
7 responsibility for thirty-five employees and no
8 day-to-day oversight was a managing agent); Wysinger v.
9 Auto. Club of S. Cal., 157 Cal.App.4th 413, 428-29
10 (2007) (a vice president of a geographically limited
11 area of operations with substantial authority to make
12 personnel decisions was a managing agent). As a result
13 of these decisions, the Court cannot say that as a
14 matter of law, no reasonable juror could find that the
15 individuals in question acted as managing agents,
16 officers, or directors of the Defendant. Accordingly,
17 partial summary judgment on this issue is denied.
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III.

CONCLUSION

For the reasons set forth above, the Court DENIES

21 Defendants’ Motion for Summary Judgment or, in the
22 Alternative, Partial Summary Judgment.
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IT IS SO ORDERED.

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25 DATED: April 16, 2015
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HONORABLE RONALD S.W. LEW
Senior U.S. District Judge

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